Claims of an Executor Contrary to Interest of the Estate

Once an individual is appointed as the Executor of the Estate, the Executor may utilize Estate funds in order to undertake actions which are in the best interests of the Estate. Such actions may include defending against claims brought against the Estate by beneficiaries, potential beneficiaries, or third parties.

Another instance may involve bringing claims on behalf of the Estate in an attempt to enrich and increase the corpus of the Estate. These may be claims against parties who have may have taken Estate funds, or against other entities in an attempt to increase the corpus of the Estate. One category of actions, however, for which an Executor may not utilize Estate funds, is to either defend or prosecute actions which only either protect the interests of the Executor or seek to increase the assets of the Executor. Under these circumstances, an Executor would not be permitted to use Estates funds in such actions.

Both the case law and the relevant statutory law is clear that an Executor is entitled to use Estate funds to either protect the corpus of the Estate or to increase the corpus of the Estate. As discussed above, this may also include either include prosecuting or defending actions on behalf of the Estate.

At no time, however, may the Executor act in self-interest by solely seeking to protect their assets or to increase assets for their own use which run contrary to the interests of other beneficiaries of the Estate. Under those circumstances, this individual must utilize her own funds and not interests of Estate funds. Should an Executor of the Estate utilize Estate funds for their own self-interest, this Executor will be required to repay these funds back to the Estate.

If you are serving as an Executor to an Estate, you should be well aware of the Court Rules and case law which address utilizing the Estate funds. It is also suggested that if there are any uncertainties, that they consult with a probate litigation attorney to determine the best course of action.

from New Jersey Law Blog https://ift.tt/2CQAASk
via IFTTT